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Measuring homeownership affordability in emergent market context: an exploratory analysis for Turkey

Yener Coskun (Department of Urban Studies and Planning, The University of Sheffield, Sheffield, UK)

International Journal of Housing Markets and Analysis

ISSN: 1753-8270

Article publication date: 31 July 2020

Issue publication date: 23 June 2021




This paper aims to offer an extensive empirical case study analysis by investigating housing affordability in Turkey as a whole, and in Istanbul, Ankara and Izmir over the period of 2006 and 2017 and its sub-periods.


This paper develops a theoretically informed model to assess affordability using complementary methodologies in quantitative analysis. This study seeks to help outline the nature of the problem in aggregate level and in the cities; it also seeks to offer lessons about how to address measurement and modelling challenges in emergent market contexts by constructing aggregate-/city-level housing cost-to-income (HCI) ratio, adjusted HCI (AHCI) ratio, housing affordability index (HAI) and effective HAI sensitive to multiple calculation methodologies and alternative data set involving income distribution and poverty tranches.


HCI, AHCI, HAI and EHAI models generally suggest the parallel results: housing is not affordable in Turkey and in Istanbul, Ankara and Izmir except for the highest income groups. The evidence implies that besides macroeconomic instabilities, distorted interest rates and short average mortgage maturity, poverty and unequal income/wealth distributions are the main reasons of the Turkish housing affordability crisis specifically heightened in metropolitan areas such as in Istanbul.

Research limitations/implications

The evidence provides an insight on housing affordability problems in Turkey. However, small sample size and short observation period create a limit for generalisation of the findings. Further analysis would be required to illustrate how housing affordability changes in different cities of Turkey in a longer period.

Practical implications

By using empirical approaches, this paper helps to understand how serious housing affordability problems of Turkey in aggregate and urban levels. This evidence helps to explain declining ownership ratio in low-income groups and in urban areas. Reliable explanations on existing housing crisis of Turkey also help to develop affordable housing policies.

Social implications

Declining housing affordability and homeownership ratio may translate as the rising housing inequality and insecurity among Turkish households. Moreover, better affordability values of higher income groups suggest that existing inequality, economic/social segmentation, and hence social tension between high and low income groups, may further increase. In this respect, the authors suggest socially important policies such as reducing income/wealth inequalities and increasing affordable housing supply.


This study offers a detailed empirical case study analysis that can be used as an exemplar of how to overcome data constraints in other evolving housing market contexts. This study sets out an approach overcoming the challenges of measurement. This study also combines existing methodological approaches with the modified variables to provide a more realistic aggregate-/urban-level housing affordability picture. The authors calculated some parts of housing affordability ratio and index series using discretionary income, minimum wage and effective minimum wage to show the variations of different measurement approaches. Some constructed series are also sensitive to income distribution and poverty thresholds. Collectively, this empirical approach, developed by using emerging market data, provides a contribution to the literature.



This study was supported by The Scientific and Technological Research Council of Turkey (TUBITAK) under the 2219 National Postdoctoral Research Scholarship Programme (research grant no 1059B191700414). The research benefited from useful comments of Craig Watkins and data construction support of Esra Alp Coskun. The author thanks Murat Atay (Garanti BBVA Mortgage) and Reidin for providing data to the study. The author also thanks the anonymous referees, whose remarks have been very helpful in preparing the final version of the paper. An earlier version was presented at the European Network for Housing Research Conference in 2014. The opinions expressed in this work are solely those of the author and do not reflect the positions of any of the organisations with which he is affiliated.


Coskun, Y. (2021), "Measuring homeownership affordability in emergent market context: an exploratory analysis for Turkey", International Journal of Housing Markets and Analysis, Vol. 14 No. 3, pp. 446-480.



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